Sawyer Pleads: Who Will ‘Keep Insurance Companies from Jacking Up Premiums While Making Huge Profits?’

Advancing the Obama administration’s efforts to impugn private insurance companies, ABC anchor Diane Sawyer set up a Tuesday night story on who will “keep insurance companies from jacking up premiums while making huge profits?” Reporter Jonathan Karl explained “the idea from the White House is to keep premiums down by simply limiting how much insurance companies can raise them,” before he relayed the White House spin: “The Obama administration is putting the heat on insurance companies, accusing them of placing profits ahead of health care.”

Karl reported “the top five insurance companies took in $12 billion in profit last year,” as if that’s shameful or excessive, and gave short-shrift to how Republicans would control costs “with a limit on malpractice lawsuits, and increasing competition to allow people to buy insurance policies across state lines.”

He concluded by returning to the Obama team’s claims that their reform regime in itself would lower costs: “As for the White House idea to have that panel control how much insurance premiums can go up, the White House acknowledges that that is only part of the solution – in fact, a temporary fix until health care can go – health care reform can go fully into effect.”

Sawyer introduced the segment by giving publicity to a puny protest: “That California company that wants to raise premiums 39 percent is the target of a legislative hearing today, as more than 100 protesters demonstrate outside.”

From ABC’s World News on Tuesday, February 23, as provided by the MRC’s Brad Wilmouth:

DIANE SAWYER: And from health, we turn to health care reform. That California company that wants to raise premiums 39 percent is the target of a legislative hearing today, as more than 100 protesters demonstrate outside. And since the President's big health care summit is this Thursday, we asked Jon Karl to answer the question: Will Republicans or will Democrats keep insurance companies from jacking up premiums while making huge profits? Jon?

JONATHAN KARL: Well, Diane, the idea from the White House is to keep premiums down by simply limiting how much insurance companies can raise them. The Obama administration is putting the heat on insurance companies, accusing them of placing profits ahead of health care.

KATHLEEN SEBELIUS, HEALTH AND HUMAN SERVICES SECRETARY: These profits are wildly excessive and way over anybody's estimate.

KARL: Under the President's plan, insurance companies would have to justify any future rate increases to a seven-member panel – a panel made up of experts on health care economics, consumer representatives, a doctor and somebody from the insurance industry. If the panel finds a rate hike excessive, the Health and Human Services Secretary would have the power to block it. Will it work? Well, insurance commissioners in 27 states currently have the power to regulate premium hikes, and have shown some success in keeping increases in check. Connecticut, for example, rejected Anthem Blue Cross Blue Shield's effort to raise premiums by 24 percent. Instead, they went up 16.5 percent. In Maine, Anthem wanted a hike of 18.5 percent, but had to settle for 11 percent. Lower increases, but still much higher than inflation. And the top five insurance companies took in $12 billion in profit last year.

Republicans, and many health care experts, say you can't do much to keep premiums down unless you deal with the underlying problem – the skyrocketing cost of health care.

SANDY PRAEGER, NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS: Price controls on insurance rates are not the cure-all. What we need is meaningful, underlying reforms in the way health care is paid for.

KARL: Republicans say they would keep premiums down by controlling costs with a limit on malpractice lawsuits, and increasing competition to allow people to buy insurance policies across state lines. As for the White House idea to have that panel control how much insurance premiums can go up, the White House acknowledges that that is only part of the solution – in fact, a temporary fix until health care can go – health care reform can go fully into effect.

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